Ag sector keeping close watch on debt ceiling talks
Debt ceiling talks are set to begin Tuesday afternoon with several high-level congressional leaders meeting with President Biden. The markets and producers everywhere will be closely watching.
Leadership at Southern Ag Credit warns a U.S. default would affect every farm, especially if they have an operating loan.
“Any operator we have with an annual operating loan, whether that be cattle, whether that be row crop, right now is facing interest rates that are more than two-times where they were at the beginning of last year. We also have a number of long-term real estate loans that will re-price this year as their pricing, original pricing, expires—they will be facing much higher interest rate costs,” Phillip Morgan, CEO of Southern Ag Credit said.
On Capitol Hill, farm leaders are concerned about the approaching June 1st deadline.
“Fed Reserve Chair Jerome Powell said, no one should assume that the Fed can really protect the economy and financial systems and our reputation globally, from the damage that a U.S. default might inflict. We shouldn’t even be talking about a world in which the US doesn’t pay its bills,” Senat Ag Committee chair Debbie Stabenow said.
Tuesday’s meeting will take place at the White House and will be attended by The President, House Speaker Kevin McCarthy, Senate Democratic Majority Leader Chuck Schumer, Senate Minority Leader Mitch McConnell and House Democratic minority leader Hakeem Jeffries.